Enhance the Guest Experience Through Payments Modernization
Digital Transformation Technology Report
- The payment landscape is evolving rapidly. Digital transformation has made its way into the payments environment, and by extension, the gaming and hospitality industry has been given a key role in digitizing their own payment services.
- Your current payment process is in a legacy state which will not survive in a digital-first environment.
- Your customers demand a modern and seamless payment experience. Removing friction becomes a priority to retain guests and reduce dissatisfaction.
Our Advice
Critical Insight
The gaming and hospitality industry’s role in orchestrating digitally transformed payment flows have become crucial with the value of payments shifting from basic processing functionality to a modern and seamless payments experience. Without providing a strategically selected solution for the “last mile,” guests and operators cannot benefit from payment innovations.
Impact and Result
- Understand how digital transformation is impacting major payment stakeholders: customers, operators, and payment service providers.
- Learn about value-added services and key features and functions that are necessary for digitally transformed payment processes.
- Gauge the current capabilities of leading payment vendors in the space and how they fare in this digital-first world.
Enhance the Guest Experience Through Payments Modernization Research & Tools
1. Enhance the Buyer Experience Through Payments Modernization – A Digital Transformation Technology Report.
An insightful report that illustrates the impact of digital transformation on major payment stakeholders and gauges the current capabilities of leading payment vendors in the gaming and hospitality space.
2. Gaming & Hospitality Payment Service Provider Shortlist Tool – Identify the PSP that best meets your payment strategy.
Develop a shortlist of payment service providers to speed the selection process.
Enhance the Guest Experience Through Payments Modernization
Digital Transformation Technology Report
Analyst Perspective
Drive seamless payment experiences online and on-property
The payments industry is in the midst of a significant digital transformation, accelerated by the pandemic. By extension, the gaming and hospitality industry has been given a key role in digitizing their own payment services and fostering the inclusion of different payment innovations as the day-to-day financial experiences of guests and players become enhanced.
Any advantage an operator wants to take relies on the payment service provider (PSP). To achieve greater success, an operator needs to look past basic functionality and low transactional fees as reasons for selecting a PSP. To achieve greater success, your PSP must be fully involved in creating an end-to-end digital processing environment that is in sync to provide compatibility with third-parties for the enablement of value-added services.
Monica Pagtalunan
Research Analyst, Gaming & Hospitality Research Center (GHRC)
Info-Tech Research Group
Executive Summary
Your ChallengeThe payment landscape is evolving rapidly. Digital transformation has made its way into the payments environment, and by extension, the gaming and hospitality industry has been given a key role in digitizing their own payment services. Your current payment process is in a legacy state which will not survive in a digital-first environment. Your customers demand a modern and seamless payment experience. Removing friction becomes a priority to retain guests and reduce dissatisfaction. | Common ObstaclesManagement concentrates on accepting payment vs. whole offer. It is common for operators to assess a PSP based on the provision of its basic function – accepting a payment. Vendor selection process has too much focus on lowest transaction fees. A secondary issue is focusing solely on vendor fees, which creates further risks and threats for the business. Focus on current state over future state. There is a tremendous level of innovation occurring in payments. A PSP plays a substantial role in the digital transformation of this industry. | Info-Tech’s ApproachUnderstand how digital transformation is impacting major payment stakeholders: customers, operators, and payment service providers. Learn about changes in the PSP ecosystems as many vendors are developing key features and functions that are necessary for digitally transformed payment processes. Gauge the current capabilities of leading payment vendors in the space and how they fare in this digital-first world. |
Info-Tech Insight
The gaming and hospitality industry’s role in orchestrating digitally transformed payment flows have become crucial with the value of payments shifting from basic processing functionality to a modern and seamless payments experience. Without providing a strategically selected solution for the “last mile,” guests and operators cannot benefit from payment innovations.
The payment process is the last mile
The last mile is the final leg of the customer’s journey and the narrowest part of the experience funnel. In the context of online, it’s the check-out page where your customers hit “buy” and they enter their payment details before completing the purchase. In the context of on-property, it’s the check-out process where customers are waiting in line to reach an employee or machine to pay.
Your customer is making a purchase at this stage. Consider the POS technology, different payments offered, and the customer-facing employees that are involved at this stage. Customer expectations involve an enhanced experience. Your guests and players are anticipating cutting-edge capabilities and smooth payment experiences.
The last mile can leave a lasting impression. The experience isn’t over yet. Customers can be turned off by any variable – it can be too many steps in the process, insufficient payment options, the data inputs required, or the ultimate acceptance or denial of a payment.
Enhance the Last Mile Experience With the Right Payment Service Provider (PSP)
The gaming and hospitality industry’s role in orchestrating digitally transformed payment flows has become crucial with the value of payments shifting from basic processing functionality to a modern and seamless payments experience. Without providing a strategically selected solution for the “last mile” in the experience funnel, guests and operators cannot benefit from payment innovations.
Define the payment flow stakeholders
Break down the payment flow
Distinguishing authorization transactions by card present, card-not-present, and e-commerce
| The Payment Flow
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Determine what value your payment process creates
Value streams and value chains connect business goals to the organization’s value realization activities. They enable an organization to create and capture value in the marketplace by engaging in a set of interconnected activities. Your payment process creates value by servicing and retaining guests (value stream) through the following payment process activities (value chains):
Value Streams: A value stream refers to the specific set of activities an industry player undertakes to create and capture value for and from the end consumer.
Value Chains: A value chain is a ”string” of processes within a company that interrelate and work together to meet market demand. Examining the value chain of a company will reveal how it achieves competitive advantage. Each value chain has a stakeholder associated with it. This is the primary stakeholder that seeks to gain value from that value chain.
Visit GHRC’s Integrated Casino Industry Reference Architecture
Info-Tech Insight
There seems to be a misperception that digitally transformed payments solely impact online channels. The last mile is an on-property challenge too. A more pronounced payment process at the POS involves contactless payments, enhanced authorization, and fraud and chargeback mitigation solutions.
The gaming and hospitality industry’s last mile remains traditional
A legacy stack risks the customer journey from pushing forward
The customer is interested in purchasing a product or service from the business…. |
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…but finds the payment experience underwhelming… |
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…and either abandons the purchase and/or is dissatisfied with the process… |
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…all while the operator deals with their own set of issues. |
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Infrastructure must keep pace with demand for cashless
The use of cashless is projected to increase. The pandemic reinforced major shifts in payment behavior: declining cash usage, increase in online commerce and engagement, and adoption of instant payments.
Cashless forces a change in payment infrastructure, bringing in a new and merging mix of payment types (Illustration on the right). These cashless payment types are enabled by merchant-level payment systems including on-property point-of-sale (enabled credit and debit, RFID, NFC) or contactless (mobile applications, electronic wallets, online browsers).
Increase revenue and efficiency while shedding light on valuable insights by providing an array of cashless types. Limiting payment options can reduce customer buying power and make it more likely that they will go elsewhere. Leveraging cashless payment types makes sense since they dominate the payments industry and create an incredibly fast payment process. A bonus is the data that cashless provides. Unlike cash, cashless payment types can shed light on customer trends including behaviors, transactions, and preferences even outside the four walls of your property.
Cash service rebate is an incentive that still inhibits the push to cashless. Cash is the only payment method that doesn’t charge fees and may undermine motivations to force this necessary change in payment infrastructure. Further, cashless payment types vary in fees. The higher the fee, the less likely an operator will choose to include it in their mix. In the case your payment processor is also your cash service provider, your organization has the risk of vendor lock-in as well.
Digitally transformed payments provide data to build loyalty
Build a converged payments and loyalty architecture
The payments evolution is creating changes in the PSP vendor ecosystem
Re-evaluating value propositions
Draw the line between traditional versus modern platforms. Complicated IT infrastructure, heavy legacy technology faces the maximum weight of issues in a digital-first environment. It could create larger obstacles to transformation of operator's payment process.
- Legacy providers are primarily sales-driven and seek to add new customers to scale existing services, performing front-end and middle-space spaces, and focusing on the payment terminal installation as the main value-added service.
- Modern platforms changed the model by focusing on front-end, developing innovate products to pull customers in and improve service. For example, modern platforms focused on open-API frameworks to sell adjacent non-payment products such as customer loyalty management, website development, and business analytics.
M&A activity has accelerated. Processor consolidation enables large processing companies to build at scale across geographies and to enhance their suite of capabilities to stay competitive in the face of next-generation merchant-services platforms. This has been a US-led trend, with a focus on building domestic scale, culminating in three landmark, multibillion-dollar deals in 2019: the acquisition by Global Payments of TSYS; Fiserv buying First Data; and FIS acquiring Worldpay.
Factors driving better payment solutions
83%Improve efficiency of the payment system | 69%Respond to technological innovations | 63%Reduce system risk |
Source: Mastercard, 2022.
The roadmap of PSPs is crucial as they accelerate their digital transformation strategy
Vendors in the space are developing and focusing on several functionalities in their roadmap:
Integrations Ecosystem
Card processors must make moves that position them more effectively for payment initiation, specifically partnering with significant cashless payment providers.
ML/AI & Risk Solutions
For regulatory compliance and protection against chargebacks, anti-money laundering and fraud, as well as the enablement of Know-Your-Customer capabilities.
Automated Merchant Onboarding
The process of merchant setup can be complex with the various parameters. Providing a user-friendly and automated interface will help improve the operator experience.
API/Microservices Infrastructure
This type of infrastructure is common in modern platforms. The infrastructure’s objective is to build a digital core that allows the PSP and their merchants to widen the integration of their offerings across platforms and services.
Value-Added Services
Broadening your offerings ensures relevance. Focus on services that are flexible, protect funds, and optimize the customer experience. Examples include:
- Financing
- Marketing support
- Software, cloud, and design
- Loyalty & gift
- Payroll, employee management
- Tax, accounting and legal
- Customer support
How PSP selection impacts your organization
As payment service providers improve their digital transformation roadmaps, merchant organizations must consider implications to their own digital transformation initiatives
Payment process metrics to consider
Objective | Metrics & Descriptions |
Assess whether the payment set is optimized and the customer experience is frictionless | Conversion rate – percentage of unique visitors that are able to pay and complete their purchase Authorization rate – performance percentage of card payments that require real-time approval from card issuer and whether payments have proceeded successfully Net promoter score – calculate customer satisfaction of the payment process |
Assess the payment process as a loyalty tool | Carded play – expect an increase in carded play with the need for loyalty enrollment to enable cashless Token management – tokenization of customer’s payment data to enable merchants to follow spending per sales channel and set up strategies to drive a customer from one channel to another |
Assess the security of your payment process | Fraud rate – monitors fraudulent transactions Chargeback rate – monitors instances of customers verifying chargebacks and challenges those that may not be warranted |
Assess impact on profitability and the optimization of internal operations | Total cost per transaction – assess cost of accepting various cashless payment types Capture rate – identify if all authorized transactions are sent for settlement. An authorization can be cancelled for many reasons i.e. fraud, cancellation, overbooking, etc. |
Assess PSP services and technology | Speed to API – determine time to market Speed to merchant onboarding – determine time to approval Uptime rate – percentage your provider is online and processing successfully. Consider system outages, hacks, or anything else responsible for excessive downtime. Many guarantee 99.99% uptime… do they deliver? |
Focus on single source vendors
Not all payment processors have a payment gateway and vice versa. Some providers use a 3rd party payment gateway which can be a hassle when you have a dispute, or an M&A occurs. It is best to select a processor and gateway from a single provider. This reduces errors, speeds up transaction processing, and eases reconciliation.
Single-Source Approach
Best-of-Breeds Approach
Definition | A single provider for both processing and gateway solutions. | A separate processing provider and separate gateway provider that communicate and integrate with one another. |
Benefits | Multiple RFPs can be time-consuming. A singe-source approach means most payment flow requirements can be issued in one master RFP. The merchant knows who to talk to for any payment flow issues from the POS to Acquirer. Removes vendor’s dependence on third parties which will increase value-added services and customer satisfaction. | There are merchants that prefer to have multiple processors to add redundancy, reduce business continuity risk, and measure performance and authorization rates. A change in processor strategy means no change is needed for payment terminals since they are keyed to your gateway. It’s known for accounts to change processors every 3-5 years because of rate fluctuation. If processing rates go up, it is easier to migrate to another processor. |
Drawbacks | Lose negotiating power when you choose one solution since you have one rate. Multiple business models burns bridges High switching costs | Many instances where gateway providers are being acquired by major processor companies which could cause culture and product development conflicts, and could therefore, negatively impact client users. Separate providers for each aspect of the payment flow can cause vendor management challenges, a time-consuming procurement process, and a difficult time finding the root area of cause. |
Key PSP Vendors
Info-Tech identified 12 applicable single-source vendors. The vendors are listed in alphabetical order.
The “lowest rate is best” is a myth
All costs must be considered to truly understand the cost of any service. The kind of support, security, and features your payment processors provides is also a major aspect of the cost. If your provider offers minimal security and slow support will the loss of sales and technical problems outweigh saving a few dollars a month? Most likely not. While you need to consider cost in any business decision you make, quality of service also needs to be examined.
Low rates can be misleading
Consider these fees in the provider evaluation process to avoid falling into the trap of unknowingly overpaying for transactions.
- Buy Rates: The processor's costs associated with opening and maintaining the merchant's account (Acquiring bank markup + interchange fees)
- Card Issuer Charges: Charges made by the card-issuing bank based on the type of card and its location. For example, Booking.com's issuing bank charges an additional 2% for its VCC.
- Card Scheme Fees: Fees charged by card network brands.
- Card Tokenization Charges: When the system tokenizes your customer's credit/debit card. Processors vary in tokenization rates. Some systems "double tokenize". For example, they charge a guest twice when modifying a reservation on an OTA to extend a check-out date.
- Payment Gateway Fees: To initialize the transaction: payment, refund, preauthorization, collect/cancel preauthorization. Initializing cost + markup cost varies from gateway to gateway
What to consider when choosing a payment service provider (PSP)
Consideration | Description |
Data & Analytical Tools (including fraud and security) | Consolidated reporting for transactions, such as multi-location credit card processing, cashless solutions, and loyalty and rewards data. Reporting for the verification of account balances to ensure data is true, consistent, and up-to-date. Consider whether the provider’s tools involve ML/AI capabilities, risk scoring, or mule account modeling. |
Customer Support | From discovery to delivery, consider the type and frequency of support that the vendor provides to ensure success in the payment space. |
Automated Merchant Onboarding | Consider a frictionless and automated experience with unnecessary disruption to realize full value and promote end-user adoption. |
Integrations Ecosystem | The variety of push/pull technology implementations that streamline your tech stack for third-party integrations. More specifically, the alternative payment methods in the ecosystem matter. |
Value-Added Services | A variety of functionalities and push/pull technology implementations that streamline your tech stack for third-party integrations and supports a long-term gaming and hospitality payment strategy i.e. loyalty. |
Crypto Acceptance | The payment platform enables merchants to receive payments in cryptocurrency from customers in exchange for the goods and services being sold or delivered. |
API/Microservices Architecture | An open-API framework will promote ease of integration for both value-added services and your integrations ecosystem in an online and brick and mortar guest environment. |
Cashless Payment Types
Vendor Analysis
- Vendor Name: Adyen
- Headquarters: Amsterdam
- Employees: 1,001-5,000
- Presence: AMS:ADYEN
StrengthsApproved in 2021 for a US federal branch license. As a merchant acquirer, it becomes easier to operate and enable faster payouts, direct settlement of funds, etc. Strong from a technical standpoint with a more advanced, powerful, and stable platform, which means maximum speed, quality of service, flexibility, and security. Recognized as a provider that simplifies complex processes by running a single platform for both online and POS. A strength to enable updates, singular API, and a channel-agnostic back-end. Front-end and back-end technology is built in-house in a single solution. It can be viewed as both a pro and con as it allows for rapid scaling but lacks customization for merchants. Known for their AI/ML systems, providing their clients with quality data to learn more about customer buying patterns. Additional functions that may be beneficial to the operator:
| Areas for ImprovementKnown for higher processing fees than other vendors in the landscape. Look to negotiate appropriately. A potential upside to price is that it omits account management, tokenization, account creation, and consultative fees. Offers great functionality for online businesses as an organization that initially processed online payments solely. Adyen is working to improve POS innovation and development, but there may be a lack of features or functionalities for brick-and-mortar operations in comparison to other vendors in the landscape. The idea of all-in-one solution vs. single-sourced; Adyen forces its hand with an all-in-one tech stack. There are PSPs that offer a wide range of solutions and allow operators to choose. i.e. Elavon includes both payment processing and gateway but gives clients the choice if they want one or both. Adyen supports all necessary revenue streams of a resort including regulated gambling. However, it is considered a “Restricted” product/service which means that additional documentation and investigation is required prior to onboarding. Although accepted, it is clear that gaming may not be an industry that they are focused on, potentially impacting long-term payment strategy. The solution is out of the box, requiring customization by the merchant. | Vendor StrategyInitially an online-only processing provider but is using their knowledge and expertise to expand to POS Refuse to acquire other payment business in their roadmap as they find cons in merging tech stacks Impressively replaced PayPal as the payment processing provider for eBay CitizenM, Kempinski, and Belmond are recognized hospitality clients High client stickiness as more than 80% of growth comes from existing merchants (2021) Although a European-based company, 40% net revenue comes outside of EMEA with 74% from North America (2021) |
- Vendor Name: Amadeus IT Group
- Headquarters: Madrid Spain
- Employees: 10,001+
- Presence: BME:AMS
StrengthsCompetitive position as the largest player to connect the travel industry in its entirety: airlines, hotels, car rental companies, cruise lines and travel agencies. Offers payment gateways and processor provision with acquiring services through partnerships. Supports over 300+ alternative payment methods. Through their Xchange Payment Platform, operators can consolidate payment data and transactions in a central area. Although primarily focused on airline-related markets, they have been putting more development into their hospitality division with single solution platform mentality, offering the following products that many hoteliers are already leveraging:
Ability to streamline the payment process experience with the Amadeus Travel Platform’s B2B Wallet solution: reduces demand on travelers to provide upfront payment information or to make payments at the check-in/out. Enables the choice of using 14 different card types (credit, debit, pre-paid). | Areas for ImprovementRather than in-sourcing, they are partnering with other risk management solutions i.e. Cybersource. Although this could be viewed as a strength with a stronger competitive position, any downtime such as system outages or hacks can prove fatal on Amadeus’ end. Amadeus prefers signing long-term contracts (roughly 3-20 years) which can be viewed as a pro and a con. It’s a pro because operators can lean toward integrating a full solution set from Amadeus. It’s a con because it could increase “switching costs” and if an operator is has a negative experience, they will be “stuck” in the relationship. Strong presence in Europe, the Middle East, Africa (EMEA) and Asia Pacific, with less presence in the Americas. Amadeus’ biggest competitors is Sabre who has more presence in the Americans but is not a PSP, and instead leverages providers like Shift 4 (Processor and gateway) and Cybersource (Gateway). No mention of AI/ML capabilities for risk management. However, there is mention of AI/ML for NLPS with their Aimendo partnership. | Vendor StrategyAmadeus focuses on payment solutions for travel-specific use cases Founded in 1987 by Air France, Iberia, and Scandinavian Airlines Systems Amadeus B2B Wallet Partner Pay won award of Best B2B Payments Program at the 2021 Emerging Payment Awards Won Merchant Payment Ecosystem Awards 2021 and Payment Innovation of the Year at FSTech Awards 2022 |
- Vendor Name: Elavon
- Headquarters: Atlanta, Georgia
- Employees: 1,001-5,000
- Presence: NYSE:USB
StrengthsAs a merchant acquirer, it becomes easier to operate and enable faster payouts, direct settlement of funds, etc. Offers solutions for a full-tech stack but there is no requirement to use both. Front-end and back-end processing are in-house solutions. Develops solutions based on industry i.e. restaurants vs. travel and hospitality vs. retail, etc. Its Fusebox Payment Gateway is specific to hospitality. It is an in-house solution that is considered a strength since its other payment gateway solution, Converge, is a third-party product. Additional functions that may be beneficial to the operator:
Boosts fraud prevention through partnership with Brighterion. Offers 1:1 behavioral profiling with AI. | Areas for ImprovementAs a legacy provider (versus modern distributors like Adyen), Elavon is currently working to modernize its platform. It may be beneficial a few years from now but implementation at the present-time may not be smart decision. Ladco Leasing, a subsidiary of Elavon, has been an area of negativity for the brand. The standard leasing agreement for payment terminals are known to be expensive, long, and non-cancelable. Pricing lacks transparency especially as Elavon works with ISOs who adjust pricing on a client-by-client basis. Their roadmap for gaming/iGaming is unknown or non-existent which potentially impacts long-term payment strategy. Constantly changing fees and upcharges. | Vendor StrategyLarge operators/merchants choose to partner with Elavon because they are a wholly owned subsidiary of the US Bank Fusebox Gateway has won multiple TSG awards over the years including Fastest Average Transaction Speed (2020, 2021, 2022) Surprisingly, Elavon has been involved in a number of PCI lawsuits with a notable case being Cisero’s in Utah |
- Vendor Name: Everi Holdings Inc.
- Headquarters: Las Vegas, Nevada
- Employees: 1,001-5,000
- Presence: NYSE:EVRI
StrengthsFocused on the gaming industry, Everi operates in various segments: games, fintech, and loyalty. In fact, Everi places a greater focus on the loyalty business in the context of payments i.e. co-branded credit cards
Competitive differentiator is its coupled approach to an alternative payment method: providing the technology for the digital wallet and processing the payments that come through. A very different approach than say Sightline, which is a digital wallet but relies on JP Morgan for its payment processing. Financial services are not limited and include funds dispensed, credit cards, check the warranty, etc. Only gaming supplier that offers an integrated payment system that is beneficial to unify disparate operator gaming systems to accumulate and share information and facilitate maximum patron utilization. Expand cashless product offerings and compliance and efficiency products for an all-in-one gaming solution that provides value-added services: cash services, mobile wallet, integrated kiosks, AML/tax compliance, Jackpot processing, AML intelligence products, and credit reporting. | Areas for ImprovementIn comparison to Global Payments, Everi is limited as an all-in-one solution with pure focus on gaming. Everi requires integration with gateways for other verticals i.e. Adyen or Shift4 for hotel. Their R&D on casino games online and on-property dilutes a fintech focus, especially in comparison to NRT Technology. No mention of AI/ML capabilities for risk management. | Vendor StrategyFounded in 2015 Fintech segment grew by 27% from 2021 to 2022 to US $91.7 million First provider in the gaming industry to be fully end-to-end EMV compliant Clients include Railsr Partners, New Sky River Casino, and Penn Entertainment |
- Vendor Name: Worldpay from FIS
- Headquarters: London, United Kingdom
- Employees: 5,001-10,000
- Presence: NYSE:FIS
StrengthsAs a merchant acquirer, it becomes easier to operate and enable faster payouts, direct settlement of funds, etc. FIS is pushing toward a merchant-centric business, which will benefit merchant markets including their online gaming and state lottery specialization. Recognized as a gaming industry “SME,” Worldpay/FIS has a hands-on approach by working with casino hardware and software partners and regulators. In fact, many of their in-house staff have worked in the sector itself. FastAccess system functionality has led to a drop in declines for insufficient funds. Their incorporation of systems like Visa Direct and Mastercard Send results in faster payment, increased customer loyalty, reduced fraud, and reduction in merchant handling costs. Intelligent dispute management platform combats chargebacks with its disputes portal that makes it easy to monitor any and all chargeback claims and submit evidence, while disputes deflector and defender offer services to prevent chargebacks and recover revenue. A traditional PSP that enables crypto commerce Unlike many of the other vendors in the space, Worldpay does not sell through any other channel than in-house sales personnel with market expertise. Although considered a competitor with companies like Block, Square, etc., it is interesting that Block’s Cash App Card is actually powered by FIS. | Areas for ImprovementDoes not offer instant settlement. Referred to as a “melting ice cube” because of decentralized finance speculations regarding blockchain technology that could fundamentally alter how bank transactions occur, threatening the core of FIS’ businesses. | Vendor StrategyFounded in 1968 FIS acquired Worldpay Partnership with 888 |
- Vendor Name: Fiserv
- Headquarters: Brookfield, Wisconsin
- Employees: 10,001+
- Presence: NASDAQ:FISV
StrengthsFiserv’s underlying platforms, Carat and Clover, provide a modern take on merchant processing with their increased functionality and value-added services that allow them to be comparable to competitors such as Block, Toast, PayPal, and Shopify.
Fiserv’s gaming services also include:
A traditional PSP that offers immediate access to crypto wallets and social payments in the context of gaming. | Areas for ImprovementConsidered a legacy financial player with increasing competition due to its legacy payment processing business. Lack of customer support/communication. For example, Payeezy’s transition from the North platform to the Compass platform has not been explicitly communicated with customers as of December 2022 for a transition in approximately summer of 2023. Their claim of a “smooth transition” may not be as smooth as it may seem. An advanced notice should have been stated. The vendor charges a hidden inactivity fee when a merchant does not meet a sales amount requirement. Although Clover is their prize technology and growth engine, it is meant for small-medium businesses and will not be beneficial for enterprise operators. Lagging behind competitors, Fiserv is still identifying and testing AI technologies with no releases as of yet. | Vendor StrategyAcquired First Data (and Clover) in 2019 Shangri-La is a major hospitality client Further, focused verticals do exist:
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- Vendor Name: Global Payments
- Headquarters: Atlanta, Georgia
- Employees: 10,001+
- Presence: NYSE:GPN
StrengthsAfter the TYSYS acquisition, Globalpayments became the largest third-party payment processer in North America. As a merchant acquirer, it becomes easier to operate and enable faster payouts, direct settlement of funds, etc. Offers merchant value-added services that streamline business operations including data analytics, customer engagement, payroll, and reporting solutions. Offers industry-specific resources for hospitality and gaming and further, can act as an all-vertical solution for online gaming, on-property gaming, and hospitality. Offerings include:
Involved in “Buy Now, Pay Later” offerings In-house processing and gateway that offers hosted payment pages, direct API integrations, one-click links, and APMs. | Areas for ImprovementPoor customer support, attracting fair share of criticism, which is highly common for large processing providers; however, the issue of low customer support is not as extreme as that of Fiserv/First Data. No mention of AI/ML capabilities for risk management. | Vendor StrategyAcquired Heartland and TYSYS Founded in1967 Gaming clients include MGM, San Manuel Casino, Viejas Casino, and Wynn Las Vegas Hotel clients include Choice Hotels, Sandman Hotel Group, Innvest Hotels, and the Shoreclub |
- Vendor Name: JPMorgan Chase & Co
- Headquarters: New York, New York
- Employees: 10,001+
- Presence: NYSE:JPM
StrengthsAs a merchant acquirer, it becomes easier to operate and enable faster payouts, direct settlement of funds, etc. Offers credit cards and loyalty services. For example, Chase has partnered with IHG Hotels and Marriott for credit card rewards. In 2021 alone, JPMorgan processed $1.7 trillion in transactions, which is an outstanding number compared to its competitors (i.e. Adyen processed $516 billion). Their Safetech Fraud solution uses AI and ML to power their fraud mitigation solution and prevent fraud attacks. | Areas for ImprovementConsidered a legacy financial player, the provider is working to upgrade its infrastructure. For example, the existing payment switches require time-consuming and costly modifications to accept anything other than 16-digit card numbers as payment tokens.
| Vendor StrategySightline Payments named J.P. Morgan Payments as the main merchant acquirer and payments processor for Sightline's Play+ ecosystem Named the top processor in the US for eight consecutive years according to the Nilsen Report |
- Vendor Name: NRT Technology
- Headquarters: Toronto, Ontario
- Employees: 201-500
- Presence: Private
StrengthsCompetitive differentiator is their focus on casino payment processing and technology solutions, having settled over $20 billion and processing over $200 million transactions annually. Target market is casino operators with the benefit of value-added services across the entire property including traditional cash transactions (ATMs), mobile transactions, marketing automation and engagement platform, casino credit (marker) automation, treasury management, table management, self-serve kiosk automation, and AML compliance. Payment processing technology consists of two PCI data centers, redundant multi-links, daily backups, peer-to-peer replications, and 24/7 monitoring. Connect+ is their omnichannel payment gateway that offers plug and play and one-stop API and accepts various alternative payment methods. Has in-house payment switches. | Areas for ImprovementEveri offers mobile app loyalty solutions in the space while NRT lacks in this space. They are trying to get into this space, however, through their partnership/integration of OfferCraft, a marketing automation and engagement platform. No mention of crypto acceptance, especially when compared to Everi. No mention of integrations with non-gaming amenities like PMS or ticketing systems. NRT does mention their ability to integrate games and POS systems, however. | Vendor StrategyFounded in 1993 Clients include Caesars, Boyd Gaming, Mohegan Sun, Station Casinos, and Seminole Gaming |
- Vendor Name: Nuvei
- Headquarters: Montreal, Canada
- Employees: 1,001-5,000
- Presence: TSE:NVEI
StrengthsTarget market includes regulated online gaming operators with gaming licenses in key states like Colorado and Indiana. In fact, regulated online gaming makes up the largest portion of their revenue (25%).
Accepts and pays out over 40 of the world’s leading cryptocurrencies with fiat reconciliation to mitigate risk against volatility. Smart transaction routing engine functionality to recover declined transactions with auto account updater technology, promoting the use of alternative payment methods Leverages their own in-house risk engine that is powered by AI and ML to factor in account age, transaction value, and balance usage to determine transactional risk levels. Open architectural, modular/scalable approach with single integrative abilities. A la carte solutions include currency management, global gateway, on/off ramp, AMPs, data analytics and reconciliation, chargeback guarantee, etc. | Areas for ImprovementPartners with other risk management solutions i.e. Cybersource In terms of customer support, they lack live chat and a dedicated account manager. | Vendor StrategyFounded in 2003 Blockchain Fest, Cryptocurrency Awards, Best Payment Processor 2021 SBC Awards, Payment Innovation of the Year 2021 Clients include Bet365, theScore, Fanduel, Entain, DraftKings, and BetMGM |
- Vendor Name: Paysafe Group
- Headquarters: London, United Kingdom
- Employees: 1,001-5,000
- Presence: NYSE:PSFE
StrengthsOffers a variety of payment solutions including online payments, integrated software payments, POS, and digital wallet. iGaming players can use Paysafe’s Skrill and Neteller digital wallets to wager bets with their clients. Offers a Paysafecash solution, allowing customers to make cash payments for online purchases without disclosing personal credit card details online for security reasons. An authorized acquiring bank across Europe. A traditional PSP that enables crypto commerce. | Areas for ImprovementRoll-out strategy can be considered ineffective. With the acquisition of multiple payment processing subsidiaries that have below-average reputations, the reputation of the Paysafe parent company has been negatively impacted too. Must compare Paysafe, Nuvei, and GlobalPayments when it comes to iGaming competitiveness. Nuvei and Global Payments’ offerings are more attractive when we consider fundamentals. In fact, iGaming only accounts for 1.5% of their total revenue and has failed to reach minimal growth targets. Drastic 2022 changes in management (shuffled CEO, CFO, and CRO) can be highly disruptive for clients when we think about the company’s future roadmap and solutions. Leverages Snowflake for AI and ML models to achieve meaningful data insights and deliver more informed and enhanced customer experiences. Other players in the space, however, already have embedded in-house AI & ML solutions available to their merchant clients. | Vendor StrategyFounded in 1996 Bet365 (Mexico), DraftKings (Kansas), Caesars, and PointsBet are clients In 2020, announced a partnership with US-based sports betting platform FOX Bet |
- Vendor Name: Shift 4
- Headquarters: Allentown, Pennsylvania
- Employees: 1,000-5,000
- Presence: NYSE:FOUR
StrengthsA strong platform for the hotel payment flow with simple API connectivity, which makes integration incredibly smooth. Payment device supply chain issues has slowed down speed of implementation for operators, making Shift4 a viable option as they keep their own inventory of payment terminals. Additionally, they pride themselves on offering terminals to merchants for free. However, operators should do their due diligence in determining the accuracy of this claim. With eyes toward the entire payment landscape, Shift4 offers additional functions that may be beneficial to operators by eliminating multiple vendors and outsourced providers:
Implemented an in-house smart routing solution that is powered by AI/ML. | Areas for ImprovementShift4’s platform was back-ended by the TSYS platform In 2021. TYSYS had an outage that directly impacted Shift4 service. Dependencies on third-party legacy systems is a threat. Note that the contract with TSYS is terminated and Shift4 migrated to Everest in 2022, its in-house solution that’s been in development for over three years.
The idea of all-in-one solution vs. single-sourced; Shift4 forces its hand with an all-in-one tech stack. There are PSPs that offer a wide range of solutions and allow operators to choose. i.e. Elavon includes both payment processing and gateway but gives clients the choice of implementing one or both. | Vendor StrategyPreviously a gateway-only provider, it changed its business model to a full tech-stack solution After the forced customer switch, 50% of growth over the past year comes from gateway customers moving to Shift4’s end-to-end platform Built for hotels, their first client is Hilton. Additionally, they own most of the gaming market for non-gaming solutions. i.e. Caesars, Stations Casinos, etc. Acquired by Lighthouse Network, a payment processing solution, in 2017 Roadmap will continue to revolve around acquisitions, with the objective of adding more solutions to the platform |
Activity: Shortlist PSP vendors
Input: Feature and vendor weightings
Output: Gaming and hospitality vendor shortlist of potential vendors
Materials: Gaming & Hospitality Payment Service Provider Shortlist Tool
Participants: Payment team (varies i.e. dedicated department or cross-departmental) such as finance, marketing, and IT
1 hour
- The Gaming & Hospitality Payment Service Provider Shortlist Tool is designed to generate a customized shortlist of vendors based on your key priorities. Your shortlist is sorted based on your industry specialization, weighted priorities, and detailed feature analysis to compute a weighted average score.
- Determine your industry specialization: Do you want your PSP to serve your gaming vertical? Hospitality vertical? Or both?
- Product Category: Does the vendor have a platform that is performing strongly and is suitable for your organization?
- Vendor Category: Will the vendor offer the best support for your business objectives? Could you see this vendor as a long-term partner?
Download the PSP Shortlist Tool
Refer to the blueprint Define Your Digital Business Strategy to determine your payments strategy
Discover value-driven approaches to digital transformation that allow you to identify what aspects of the business to transform, what technologies to embrace, what processes to automate, and what new business models to create. This approach to digital transformation unifies digital possibilities with your fan experiences.
- Design a strategy that applies innovation to your business model, streamline and transform processes, and make use of technologies to enhance interactions with customers and employees.
- Use digital for transforming non-routine cognitive activities and for de-risking key elements of the value chain.
- Create a balanced roadmap that improves digital maturity and prepares you for long-term success in a digital economy.
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